Address: 2019 Navy - 90405Details: 3 bed/3.5 bath 3,142 sq ft house, 7,000 sq ft lot, 2001 construction/remodel?
Description: Gorgeous Contemporary Spanish w vws of Catalina, mntns & ocn pks. Can be 4 bds. Custm, wd, dbl drs opn to lvly foyer. 1st level has priv bedrm suite, stp-dwn liv rm w WBFP, din rm w wine alcoves. Kit w Viking & Miele appl’s & fam rm off kit. Finished patio w built-in Viking BBQ, auth Mex tiles & stnlss sink. Paver flr in entry, din, kit & fam rms. Mstr ste w 3 clsts, ofc w/ built-in cstm cabinets, sit rm & priv dck w vws. Mstr ba w snkn spa tub & sep shwr. CA clsts. Sound systm in & out.
Previous Purchase: 8/30/06 - $1,895,000
Listing History: 1/14/10 - $1,749,000
SOLD: 3/19/10 - $1,650,000
This is a loss of $245,000 which is 12.9%. I guess this makes it about an early/mid 2005 rollback. Good job of the seller to list below their purchase price and then quickly accept a bid $100k below asking.
House looks pretty interesting and has some cool little details (see photos)...but the damn planes flying right overhead must be horrible!
Can someone explain to me why I shouldn't be waiting for a rollback to 2001 prices? I keep seeing examples of people losing huge amounts of money in real estate. Rent is much cheaper. Wages, inflation, and most assets were flat over the last decade. The weather in Santa Monica was just as good then as now.
ReplyDeleteI know I'll just get blasted, but I'm serious. Give me an economic justification why I should pay a penny more than 2001? The fence seems a lot more comfortable than the quarter-of-a-million dollar bath this guy took...
I think it's obvious we need to support the real state industry where conflict of interest is at the core of the business. Although I think 2001 is a stretch I totally agree with your point. Nothing had changed in that time except access to easier and easier money.
ReplyDeleteIf you don't mind waiting for a very long time, there is a slight chance you will get 2001 prices but you might as well just get the house now and enjoy it. Personally, with even minimal inflation, I can't see prices ever going down to 2001 levels in SM.
ReplyDeleteThey have rolled back that far in other parts of California. What makes the west side of Los Angeles so special? What is different on the West Side today vs. 2001?
ReplyDeleteMaybe we're just still being held up by the government's easy money. Except that easy money is ending...
I think you need to take inflation into account. Nine years of 3% inflation compounded is 30%. I don't believe it is likely to see quality properties in SM roll back to nominal 2001 prices...but 2001 prices +30% could be more realistic.
ReplyDeleteThe other big issue is interest rates and other market support from the government. Conforming jumbo limits are much higher now than before, rates are stupidly low, and the feds and state are throwing money at you to buy. The FED is keeping the spread between mortgages and bonds artificially low ($1.25 trillion program just ended though)...
There are a lot of issues I think about and maybe I'll do a post on it soon. But ultimately it comes down to your personal situation. I don't think there should be any rush to buy now as I don't see prices going up anytime soon. But I have also said I think the 2010-2012 period will prove to be about the time where buying will make sense if you find what you are looking for at an appropriate price.
For those who always ask what has changed, answer this: how many $200K+ jobs are there on the westside (and specifically in Santa Monica) now compared with 2001?
ReplyDeleteInflation is a good point, although it seems like we're still quite some distance from 2001 + 30%. Not to mention that I think 3% annual inflation ended in 2007.
ReplyDeleteI am so convinced this area is in a bubble of its own, I am just waiting it out in a rental I am really enjoying. It would cost me double what I am paying in rent per month, just to equal the interest it would have cost to own this place. So I like it and I'm saving a bundle. I give this situation another year, the government has successfully flooded the market with money and stalled the bursting of the bubble. But it can't forestall it, prices are simply not sustainable or justified.
ReplyDelete